STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA CONDOMINIUMS, TIMESHARES AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION-HOA ELECTION JOHN A. ROEMER and JOY A. ROEMER, v. Petitioners, GREENGROVE ESTATES HOMEOWNERS ASSOCIATION, INC., Case No. 2016-04-6241 Respondent. / FINAL ORDER Pursuant to notice, the undersigned arbitrator of the Division of Florida Condominiums, Timeshares and Mobile Homes conducted a final hearing in this case on February 8, 2017. During the hearing, the parties presented the testimony of witnesses, entered documents into evidence and cross-examined witnesses. The parties have filed post-hearing memoranda. This order is entered after consideration of the complete record. Appearances For Petitioner: Daniel Archer, Esq. Law Office of D. D. Archer, PA PO Box 2186 Minneola, FL 34755-2186 For Respondent: Daniel Rich, Esq. Clark, Campbell, Lancaster & Munson PA 500 South Florida Ave. Suite 800 Lakeland, FL 32801 Page 1 of 7
Statement of the Issues Did Greengrove Estates Homeowners Association, Inc. (the Association) improperly conduct its September 17, 2016 election? Relevant Procedural History On October 3, 2016, John A. Roemer and Joy A. Roemer (Petitioners) filed a mandatory binding arbitration petition for a homeowners association election dispute against the Association alleging that the September 17, 2016 annual election was not conducted properly. On November 10, 2016, the Association was served by its registered agent, Sentry Management, Inc. On December 7, 2016, a default was entered against the Association for failure to file a timely answer. On December 16, 2016, the Association filed an answer and a motion for to vacate default. On January 5, 2017, a case management conference was held where the Association s motion was heard. Counsel for the Association admitted that William Grey, the community association manager for Sentry Management, Inc., had dropped the ball and did not forward the petition to either the board or its attorney until after the default was entered. On January 9, 2017, the arbitrator entered an order after case management conference vacating the default. A final hearing was held on February 8, 2017. Each side presented witness testimony and entered documents into evidence. Findings of Fact 1. Greengrove Estates Homeowners Association, Inc. is the legal entity responsible for the maintenance and operation of the Greengrove Estates community. 2. Petitioners are members of the Association. Page 2 of 7
3. On September 17, 2016, the Association held its annual meeting and election for all five seats on the board of directors. 4. Petitioners allege, among other issues, that the Association s manager did not secure the ballots, mishandled proxies and did not announce all the candidates who were nominated from the floor. 5. Because a quorum of members has not been present at prior annual meetings and elections, the Association has not had an election for several years. 6. The September 17, 2016 annual meeting and election was held outside in a picnic area. 7. The board delegated the running of the election to their licensed community association manger, William Grey of Sentry Management, Inc. 8. Mr. Grey left the ballot box and blank ballots unattended for long periods of time. When Mr. Grey was not present, members were mulling around the picnic table where the ballot box and blank ballots were located. 9. Many members could not hear the nominations that occurred from the floor. Mr. Grey prepared only one sheet of paper that listed all the candidates which was circulated among the picnic tables. However, many members stated they did not see the complete list. 10. No instructions were given to the members on how many candidates they could vote for. 11. There were no procedures on how proxies were to be handled and verified. Mr. Grey was confused and gave conflicting determinations. 12. Mr. Grey admits he was having personal issues at the time. Page 3 of 7
13. One member described the election as absolute chaos. This meeting and the election were conducted without organization, clear leadership and clear directions to the membership. 14. Article V of the Association s Bylaws provides: ARTICLE V. BOARD OF DIRECTORS - NOMINATION AND ELECTION Section 1. Nomination. Nomination for election to the board of directors shall be by nominating committee. However, nominations may also be made from the floor at any annual meeting of members. The nominating committee shall consist of a chairman who shall be a member of the board of directors and two or more members of the association. The committee shall be appointed by the board of directors prior to each annual meeting to serve from the close of such meeting until the close of the next annual meeting, and such appointment shall be announced at each annual meeting. The nominating committee shall make as many nominations for election to the board of directors as in its discretion may determine, but in no event shall it nominate less than the number of vacancies to be filled. Section 2. Election. Election to the board of directors shall be by secret written ballot. At such election the members or their proxies may cast in respect to each vacancy, as many votes as they are entitled to exercise under the provisions of the Protective Covenants. Persons receiving the largest number of votes shall be elected. Cumulative voting is not permitted. Conclusions of Law Sections 720.306 and 720.311, Florida Statutes, provide that the Department shall conduct mandatory binding arbitration of election disputes between a member and a homeowners association. Section 720.306(9)(a), Florida Statutes, governs election of directors for homeowners associations. It provides: Elections of directors must be conducted in accordance with the procedures set forth in the governing documents of the association. Except as provided in paragraph (b), all members of the association are eligible to serve on the board of directors, and a member may nominate himself or herself as a candidate for the board at a meeting where the election is to be held; provided, however, that if the election process allows candidates to be nominated in advance of the meeting, the association is not required to allow Page 4 of 7
nominations at the meeting. An election is not required unless more candidates are nominated than vacancies exist. Except as otherwise provided in the governing documents, boards of directors must be elected by a plurality of the votes cast by eligible voters. Any challenge to the election process must be commenced within 60 days after the election results are announced. The bylaws of the Association require a secret ballot and permit proxies for election of directors, but otherwise are silent as to the procedures which must be followed. It is clear that Mr. Grey was unprepared for a quorum to be present, and therefore, was unprepared to conduct the election properly. The entire meeting was chaotic and lacked the organization and leadership to competently insure the integrity of the election. The Florida Supreme Court in Boardman v. Esteva, 323 So. 2d 259, 265 (Fla. 1975) stated, we hold that the primary consideration in an election contest is whether the will of the people has been affected. The fundamental inquiry should be whether or not the irregularity complained of has prevented a full fair and free expression of the public will. Dobbins v. Tiffany Woods Homeowners Ass n, Inc., Arb Case No. 2009-05-1294 (December 9, 2009). There can be no dispute that the actions of the community association manager in this case adversely affected the sanctity of the ballot and the integrity of the election. He was careless with the ballots, not all candidates were known to all voters and proxies were mishandled. As this is determinative of the matter, it is unnecessary to address Petitioners other complaints regarding the election. 1 Based upon the foregoing, it is ORDERED: 1. Petitioners requested relief is GRANTED. 1 Petitioners also complained that members were handing out campaign flyers. Unless Petitioners can show a violation of the statute or the governing documents or that the sanctity of the election was affected, normal campaigning is permitted. Page 5 of 7
2. The results of the September 17, 2016 election are void and the holders of the five director seats are those who filled the seats immediately before the September 17, 2016 annual meeting and election, assuming they are otherwise qualified and wish to continue to serve. 3. Consistent with the requirements of this Order as set forth above, the Association, no later than May 15, 2017, shall hold a new election for all five seats on the board. 4. The Association shall mail the Notice of Election consistent with the Association s Bylaws, providing adequate notice thereunder to meet the May 15, 2017, or earlier election date. 2 5. The Notice of Election shall include the following statement which shall be printed in bold, all capital letters, 12 point font size, in a format identical to the following: IN ORDER TO COMPLY WITH THE APRIL 4, 2017, SUMMARY FINAL ORDER, CASE NO. 2016-04-6241, ENTERED BY THE ARBITRATION SECTION OF THE DIVISION OF CONDOMINIUMS, TIMESHARES AND MOBILE HOMES, FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, A NEW ELECTION TO REMEDY DEFECTS IN THE SEPTEMBER 17, 2016 ELECTION PROCESS MUST BE HELD COMMENCING WITH THE ENCLOSED NOTICE OF ELECTION. A COPY OF THE SUMMARY FINAL ORDER MAY BE OBTAINED FROM THE ASSOCIATION OR BY CALLING 850-414-6867. 2 Section 720.306(5), Florida Statutes requires a minimum of 14-days notice for a member meeting. Page 6 of 7
Florida. DONE AND ORDERED this 4th day of April, 2017, at Tallahassee, Leon County, Terri Leigh Jones, Arbitrator Department of Business and Professional Regulation Arbitration Section 2601 Blair Stone Road Tallahassee, Florida 32399-1030 Telephone (850) 414-6867 Facsimile (850) 487-0870 Certificate of Service I hereby certify that a true and correct copy of the foregoing final order has been sent by U.S. Mail and email to the following persons on this 4th day of April, 2017: Daniel Archer, Esq. Law Office of D. D. Archer, PA PO Box 2186 Minneola, FL 34755-2186 Email: ddarcherlaw@gmail.com Attorney for Petitioners Daniel Rich, Esq. Clark, Campbell, Lancaster & Munson PA 500 South Florida Ave. Suite 800 Lakeland, FL 32801 Email: drich@cclmlaw.com Attorney for Respondent Terri Leigh Jones, Arbitrator Page 7 of 7